According to highly placed sources, the money had since been transferred to Paramount Airways.

Sources said that KIGF was issued fresh shares at an undisclosed premium. Paramount Airways was reportedly valued at $150 million. The induction of a private equity fund was more for strategic reasons, it was pointed out. The domestic carrier is also looking at the option of raising further funds as it spreads its wings.

Currently, the airline is operating a total of eight flights daily from Coimbatore to Kochi, New Delhi and Chennai.

The promoters have invested Rs. 600 crore for acquiring five Brazilian-made Embraer Jets (70-seater), of which one has already been taken delivery of. The second one would be inducted into the fleet by December.

Paramount Airways is an outfit belonging to a textile group in Madurai. The Managing Director of the company is M. Thiagarajan, grandson of Karumuthu Thiagarajan.